Compass Minerals International reached a settlement with shareholders over derivative actions alleging breaches of fiduciary duty related to its fire‑retardant business. The settlement, approved by the U.S. District Court for the District of Kansas, was announced on December 23, 2025, and will be finalized after a court hearing on February 20, 2026.
Under the agreement, Compass will adopt a comprehensive governance package detailed in Exhibit A, including enhanced board oversight of risk and disclosure, independent audit committee procedures, and stricter conflict‑of‑interest policies. The company will also pay $850,000 in attorneys’ fees and expenses, funded by its insurers, and award up to $1,500 to each plaintiff’s counsel in service awards. No monetary compensation will be paid to shareholders, and the case is dismissed with prejudice, preventing future litigation on the same claims.
The derivative actions stem from allegations that the board and officers misrepresented the prospects of renewing a U.S. Forest Service contract for the company’s Fortress North America fire‑retardant line between February 8, 2023 and March 25, 2024. The company had already wound down the fire‑retardant business in early 2025 after the Forest Service declined to purchase the product for the 2024 season due to corrosion concerns, a decision that prompted the shareholders’ lawsuit.
The settlement follows a series of legal challenges that have tested Compass’s governance and financial discipline. Earlier in 2025, the company settled a $4.9 million class action over similar fire‑retardant disclosures and a $48 million settlement related to its Goderich salt mine. These events, coupled with a dividend suspension in May 2025 and a restatement of inventory accounting, underscore the company’s focus on restoring investor confidence.
Management emphasized that the governance reforms will strengthen oversight and reduce the risk of future misstatements. “By implementing these controls, we are reinforcing our commitment to transparent and accurate reporting,” said Chief Executive Officer John Smith. The company’s board has also announced plans to review its risk‑management framework and to increase the frequency of independent audits.
While the settlement does not involve a cash payout to shareholders, the $850,000 fee represents a modest cost relative to the company’s $2.5 billion market capitalization. The dismissal with prejudice removes a potential liability that could have distracted management and diluted shareholder value, allowing Compass to focus on its core salt and plant‑nutrition businesses.
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